International Accounting Standards Differ from U

question 48

Multiple Choice

International accounting standards differ from U.S.Generally Accepted Accounting Principles in that International standards

• A)require that firm sale or purchase commitments are accounted for as fair value hedges.
• B)require that firm sale or purchase commitments are accounted for as cash flow hedges.
• C)state that firm sale or purchase commitments may not be treated as a hedged transaction.
• D)permit firm sale or purchase commitments to be accounted for as either fair value hedges or cash flow hedges.

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Definitions:

Cost Of Goods Available

The total cost of inventory available for sale during a period, calculated as beginning inventory plus purchases minus ending inventory.

Periodic Inventory System

An accounting method where inventory is physically counted at specific intervals to determine the level of inventory and cost of goods sold.

Perpetual Inventory System

An inventory accounting system that records the sale or purchase of inventory immediately through the use of computerized point-of-sale systems and enterprise asset management software.

Statement Of Financial Position

A balance sheet is a financial statement that outlines a company's equity, liabilities, and assets at a certain date.